Updated March 12th, 2024 at 16:37 IST

Oracle outperforms quarterly profit expectations driven by AI demand

The 46-year-old tech giant, known for its database services, has been strategically shifting towards cloud computing, aiming to compete with Amazon.com.

Reported by: Business Desk
Oracle | Image:Unsplash
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Oracle quarterly profits: Oracle surpassed quarterly profit expectations driven by the surge in demand for generative AI, as it prepares for a joint announcement with chip-giant Nvidia. The company's shares soared nearly 14 per cent in after-hours trading, adding over $40 billion to its market value.

The 46-year-old tech giant, known for its database services, has been strategically shifting towards cloud computing, aiming to compete with industry leaders like Amazon.com. Oracle's collaboration with Microsoft and Nvidia highlights its efforts to improve its cloud services and cater to the growing demand for AI infrastructure.

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Oracle CEO Safra Catz underlined the robust demand for Oracle's Gen2 AI infrastructure, outstripping its supply despite the aggressive expansion of cloud data centres. Oracle's executives reiterated the significance of the partnership with Nvidia, hinting at forthcoming developments in the coming week.

Excluding exceptional items, Oracle reported earnings of $1.41 per share for the third quarter, surpassing analysts' projections by 16 per cent. The strong performance in booked revenue, with Remaining Performance Obligations up by 29 per cent year-on-year, indicates promising future results, according to analysts.

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However, Oracle fell short of revenue expectations, recording $13.28 billion for the three-month period ending February 29, slightly below the consensus estimate of $13.30 billion. The company's revenue forecast for the current quarter, with growth expected in the range of 4 per cent to 6 per cent, was lower than analysts' projections, signalling cautious optimism amid evolving market dynamics.

(With Reuters inputs)

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Published March 12th, 2024 at 16:37 IST